Jul 17, 1998

US AGENDA FOR AGRICULTURE TALKS

Geneva, 16 July (Chakravarthi Raghavan) -- The United States agenda in the agricultural negotiations at the WTO would include end to all export subsidies, reducing tariffs and ending decoupled payments to farmers, according to the US Special Trade Ambassador on Agriculture at the USTR, Amb.Peter Scher.  

Scher has been in Geneva where he has held talks with the Cairns Group, the European Community and WTO officials.

At a press briefing Wednesday evening, Scher said that the US wants the agriculture talks to begin as soon as possible as required in the Agreement on Agriculture, and atleast launch these negotiations at the third WTO Ministerial Conference to be held in the USA in the last quarter of 1999.  

As part of the agriculture talks, the US also wants to have discussions on bio-technology and genetic patenting.  

Most of his discussions, and the information at the briefing, related to bilateral agricultural trade issues with the EC. The US exports some $9 billion of agricultural products to the EC and imports about $2 billion worth from the EC -- leaving the US with a sectoral bilateral surplus in this of two billion dollars. And the US wants to expand this, and enter into a dialogue with the EC to prevent a crisis as is now the case in its dispute with the EC on hormones and bananas.

The US-EC talks are in the framework of the socalled Trans-Atlantic Partnership (an accord which was something less than the one for Transatlantic Free Trade that the EC Vice-President Leon Brittan advocated, but which was vetoed by France).  

The US-EC talks are to focus immediately on the problem wine trade where there are problems of 'marks of origin' (geographical appellation problem) and what is described as a technical one, namely the process used in the US in wine production by adding lactic acid and enzymes.  

The US complains that the EC has a bilateral accord with Australia, allowing its producers to use the same methods and export the wines to the EC.  

The US is also complaining about the EC's wine tariffs.  

The EC's tariffs on wines are about 12% while that in the US is less than four percent -- after the Uruguay Round tariff reductions are implemented. 

On the origin marks and geographical appellation issue, several of the US wines carry names like 'chablis', 'champagne' and 'beaujolais' -- which are geographical appellations in Europe for wines originating in particular regions. The use of such appellations is legal under US law, but not under the EC's, in terms of the WTO accord, and thus is barred.

The special provisions on appellations of origin, and the geographical indications for wines are set in Art 23 of TRIPs Agreement, which envisages further negotiations in this regard.  

The further negotiations in this area is linked to the demand of some of the developing countries, who had already flagged this issue during the Uruguay Round and the TRIPS discussions, relate to other geographical appellations for products -- like tea, rice, cheese etc.  

Scher told the media that apart from the bilateral discussions on this question between the US and EC, the US also wants to focus attention on "Bio-Tech" area and deal with problems before US "bio-tech" products hit the market.  

There are already problems in the introduction of genetically-engineered agricultural products, and processed products that incorporate such genetically engineered products (like soya, maize etc) where apart from the scientific issues of safety, there is also a strong consumer demand in the EC against such products being imported or put on market shelves without proper identification.  

Apart from the further reforms in the agricultural trade envisaged under the WTO Agreement on Agriculture (export and domestic support and border tariffs), the US also wants to address the bio-tech issue so that rules could be framed by which US bio-engineered agricultural products can be protected through patents and exported without any restrictions.

Scher who was in China to prepare for the Clinton visit, also said that the package on agriculture proposed by China was not adequate, and unless China improves its "package" of market access for WTO accession, it would be impossible to make a deal.